US Senate Blocks Crypto Clarity Act, Triggering Market Selloff

The US Senate failed to advance the Digital Asset Market Clarity Act on September 15, rejecting a cloture motion by a 49-50 vote that fell eleven votes short of the 60-vote threshold required to begin debate. The legislation would have established the first comprehensive federal framework for digital assets, granting the Commodity Futures Trading Commission primary oversight of crypto spot markets.

Democrats opposed the bill over ethics provisions tied to President Donald Trump's crypto business interests, with Senators Susan Collins and Josh Hawley joining them in opposition. Even crypto-supportive Democrats such as Kirsten Gillibrand ultimately voted against the measure.

“The failure puts the ball in the hands of the regulators. And while they can make rules, those are less stable and permanent than legislation.”

Markets reacted sharply: Bitcoin dropped as much as 5.3% to below $75,000, while XRP fell nearly 9% to $1.28. Coinbase shares slid roughly 10% and Circle Internet Group declined over 11%, reflecting the bill's importance to exchange market structure.

Ripple executives argued the setback does not alter XRP's regulatory standing, citing the SEC and CFTC's March joint guidance classifying XRP as a digital commodity. That classification remains in effect despite the legislative failure.

With Congress nearing recess and midterm elections approaching, the bill has no clear path forward. Regulatory authority now rests with the SEC and CFTC, whose rules lack the permanence of statute.